Insurance companies swoop on junior CLO debt as fast money holds off

Long term investors such as insurance companies and pension funds are buying more mezzanine and junior CLO debt as spreads compress. Meanwhile, asset managers and hedge funds appear to be taking more defensive positions in what they say has become a rich market.

  • By David Bell
  • 17 Jul 2017

The move from long term investors such as insurance companies and pension funds into lower rated CLO debt has priced out asset managers and hedge funds, according to two buyers speaking with GlobalCapital on Monday.

“Triple-Bs in new issue deals stand out — the curve is not inverted ...

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GlobalCapital European securitization league table

Rank Lead Manager/Arranger Total Volume $m No. of Deals Share % by Volume
1 Bank of America Merrill Lynch (BAML) 4,755 19 11.75
2 Citi 4,288 14 10.60
3 Rabobank 2,633 4 6.51
4 Goldman Sachs 2,615 4 6.46
5 Barclays 2,603 8 6.43

Bookrunners of Global Structured Finance

Rank Lead Manager Amount $m No of issues Share %
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1 Citi 83,931.01 244 12.94%
2 Bank of America Merrill Lynch 71,587.85 220 11.03%
3 Wells Fargo Securities 64,351.96 203 9.92%
4 JPMorgan 46,391.25 147 7.15%
5 Credit Suisse 37,323.31 115 5.75%